Sanuwave (SNWV) Q2 Revenue Jumps 42%

Sanuwave Health (SNWV -1.88%), a medical technology company specializing in noninvasive wound care systems, reported its second quarter 2025 earnings on August 8, 2025. The company posted record quarterly revenue, with $10.2 million (GAAP) coming in 0.6% above analyst estimates of $10.14 million. Diluted earnings per share (EPS) was $0.01, surpassing the consensus GAAP estimate of a $(0.09) per share loss. Gross margin (GAAP) reached 78.3%, up notably compared to last year. Despite strong revenue growth, GAAP operating expenses also increased, resulting in flat GAAP operating income versus Q2 2024. Overall, the quarter showcased strong sales momentum, improved margins, and underlying profitability, but highlighted continued cost and balance sheet pressures.

Source: Analyst estimates for the quarter provided by FactSet.

Company Overview and Business Focus

Sanuwave Health develops and markets noninvasive medical devices that help promote wound healing. Its primary product, the UltraMIST system, uses painless ultrasound energy to accelerate healing, mainly for chronic wounds. The company also offers the PACE product platform, which applies focused shockwave technology in therapeutic settings, but revenue is almost entirely driven by the UltraMIST wound care line.

Recent efforts at Sanuwave Health have focused on expanding its direct sales force and scaling the commercial team in pursuit of national coverage. Key to success are regulatory approval, continued reimbursement from U.S. federal payors, and driving adoption of the UltraMIST platform in both device placements and recurring consumable sales. Growing recurring revenue from consumables, maintaining full national sales coverage, and leveraging its intellectual property remain at the heart of the company’s strategy.

Quarter Highlights and Financial Performance

Sanuwave Health delivered strong commercial execution, reporting record revenue of $10.2 million (GAAP), which exceeded external expectations. Device sales climbed sharply, with 116 UltraMIST systems sold versus 72 in Q2 2024. This system, a portable wound care device, saw a 61% increase in unit sales compared to Q2 2024, and nearly doubled its first-half volume (UltraMIST systems sold increased by 86% in the first six months of 2025 vs. the same period in 2024). In total, UltraMIST accounted for 99% of revenue, with consumables—the parts that must be regularly reordered—producing $6.4 million, up 37% year over year (GAAP).

Gross margin (GAAP) improved by 5.1 percentage points, reaching 78.3%. Management stated, “This represents the highest quarterly revenues (GAAP) in Company history.” Operating income (GAAP) was steady, coming in at $1.9 million, with a similar result last year. Operating expenses increased to $6.1 million (GAAP), compared to $3.2 million for Q2 2024. The company attributed this to $1.1 million in stock-based compensation—which did not occur in the previous year’s period—and heavier investment in sales, marketing, and administration efforts.

The company showed strong expansion in adjusted EBITDA, a profit metric that strips out non-cash and non-recurring items. Adjusted EBITDA reached $3.4 million, compared to $1.5 million for Q2 FY2024. Net income (GAAP) was $1.1 million, but this should not be compared directly to last year’s net income figure due to one-time items, including a $5.3 million gain recognized from extinguishing old debts. Diluted share count increased significantly year over year as a result of a prior reverse split and new equity issuance.

Throughout the quarter, Sanuwave Health completed its long-awaited move to full national sales coverage in the United States. Management described the first half as a time of building the commercial and sales teams, with the coming quarter previewed as a period of "max construction" to strengthen sales and marketing practices. No new developments were reported regarding the company’s patent portfolio, but its large base of issued and pending patents remains a cited advantage.

From a balance sheet perspective, the company ended the quarter with $8.5 million in cash, down from $10.2 million at year-end 2024. This decrease followed negative operating cash flow for the first half of 2025 and $1.3 million in capital investments. Senior debt was $26.8 million as of June 30, 2025, and total liabilities continue to substantially outweigh both assets and shareholder equity. The company also carried $12 million in warrant liabilities, indicating ongoing use of equity-linked financing. Current liabilities were more than double current assets, and Sanuwave Health remained in a stockholders’ deficit.

Looking Ahead: Guidance and Priorities

Management provided clear guidance for the period ahead, projecting Q3 revenue in a range of $12.0–$12.7 million. This signals expected sequential growth of up to 24% from Q2 to Q3, and would represent roughly 47–53% year-on-year growth compared to FY2024. Full-year GAAP revenue guidance remained steady at $48–$50 million, which implies continued strong expansion exceeding 47% over the previous year.

For the upcoming quarters, investors will be following progress against these ambitious sales targets, particularly the company’s ability to convert national sales coverage and process improvements into accelerating system placements and consumables demand. Of note, Sanuwave Health continues to rely almost entirely on the UltraMIST system, so any industry shifts or regulatory changes could have an outsized impact. With high operating expenses, continued use of stock-based compensation, and a leveraged balance sheet, cost management and operational cash flow will be important areas for scrutiny as the company works toward its goal of breakout performance in late 2025 and 2026.

Revenue and net income presented using U.S. generally accepted accounting principles (GAAP) unless otherwise noted.